Story 1 : To Cannibalize or Not to Cannibalize

Imaging you are in a burning plane and there is no way out, there is no way to turn off that fire while airborne, what would you feel ? In sea stories and movies, they accustom the audience to see a sinking ship dropping off payloads to the ocean, may be momentarily that can save people riding the ship deck from sinking but won’t help much either if the waves are violent and strong.

Now imagine there is a magical eject button that can propel you out to a safe land, ejecting off a burning plane into the “unknown” is risky, however, not doing so would lead to surrendering of being an inevitable victim of catastrophe.

Science exists to construct and model causality, and business history accounts for hundred of cases where pitfall could and would have been avoided. At times of despair, it’s utterly frustrating to be helplessly complacent, but if a recipe of diagnosis and actionable cure is presented that’s a call for action; otherwise, not taking a proven cure for a properly diagnosed disease will at best struggle to treat the symptoms and not the root cause.

Cannibalize to Vitalize !

Creative destruction is the art of cannibalizing existing product base, but how to do so without shaking the very foundations of the existing functional business model that is still driving revenue, till the new “model” proves itself ? Some may argue that “a bird in the hand is worth two in the bush”, but still a catch-22 situation prevails.

Others debate; that “you have nothing to lose”, at the end of the day product market share is declining and gradually the product is being absorbed into larger economies of scale and stronger categories with established 800- pound gorillas, not to mention identity loss that has been incorporated with interactive whiteboards for decades.

Interactive Whiteboards via The Lens of Cannibalization

Interactive Whiteboards have been a prominent industry in the last three decades; a market that is valued today at around $2.0B, but that has significantly changed over the past five years, in short; the market is turning red, the color of blood indicating a down spiral of a cut-throat commoditized market.

At ketab we have been destined to cannibalize ourselves. Cannibalization is very tough and painful, but you have no option if you want to survive, grow and thrive, either you innovate or die slowly; it’s hard because it’s about letting go what used to be working — or thought to be still functional. The best way to do is to cannibalize yourself; that is being proactive and not reactive about it; do yourself a favor by following this advice “do unto others as you would have them do unto you”.

How the Market looks right now ?

With the advent of touch screens and interactive projectors the market became overcrowded ever than before. To make things even worse, Chinese rivals commoditized the market of traditional Interactive whiteboards with a low end disruption business model.

How to thrive in a low end disrupted market ?

Having spent around 13 years in the interactive whiteboard IWB industry, I like to visualize the vicious circle in a rock, scissors paper game whereby each form-factor of interactive product tries to take out on the others.

At ketab Technologies, we were tempted to rally in the two new categorizes namely interactive projectors and interactive flat-panel displays, as our first normal reaction, after-all the latter two categories were making significant foothold in the marketplace.

But looking again, projectors were already mainstream with established brands such as Epson, NEC, BenQ and others. Similarly IFPD are dominated by larger economies of scale than the IWB, such as Samsung, LG, TCL among other OEM players.

Paradoxically, that will even commoditize the market more and more rapidly in an accelerated fashion, and render the customer with even much more options to choose from with a variety of price offerings and parity features. That would certainly mean a highly fragmented market in terms of brand awareness and loyalty.

Leaders such as Promethean, which was sold out earlier, and Smart Technologies have been facing immense challenges combating commoditization, by observing one of the leading companies Smartech, their market share slashed from 60 % globally to around 20% excluding china for interactive flat panel display. Smart now eyes gradually replacing its IWB business with IFPs which is believed to outnumber IWB revenue as expected.

Is Cannibalization a Russian Roulette game ?

If we agree that something has to be done instead to waiting to die ! The questions would be: how to give birth to a new business entity, a new offspring that carries on the mission of successfully embarking into new orbits and exploring new frontiers without sacrificing the present and what has been working so far ?

Luckily there is a science behind cannibalization and searching for new products and business models. To know more and for a detailed account of successful cannibalization, continue to read Story 2 for a continuation of this sequel …